Stellantis NV stock (STLA) fell nearly 3% in pre-market trading after the company announced a recall of 320,000 plug-in hybrid Jeep Wrangler and Grand Cherokee models made between 2020 and 2025, following reports that some battery packs could catch fire, according to a notice from the U.S. National Highway Traffic Safety Administration (NHTSA).
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
The company said the issue stems from high-voltage battery cells that may have been built with damaged separators. Until a permanent fix is ready, Stellantis has advised owners to park their vehicles outside and avoid charging them. The automaker said it is still working on a remedy.
Recall Adds Pressure on Stellantis Turnaround Efforts
The recall comes at a critical time for Stellantis, which is in the middle of a turnaround plan in its most important market, North America. The Jeep recall could slow recent momentum in hybrid and EV sales, which is a key growth area as the company races to meet its electrification targets.
Under new CEO Antonio Filosa, who took over in December, Stellantis has pledged roughly $10 billion in U.S. investment to regain market share after years of cost-cutting under former chief Carlos Tavares. Recent months have shown early signs of recovery, with shipments in North America picking up as inventories declined.
But the recall raises new concerns about execution risk and the reliability of Stellantis’ electrification strategy, which the company has positioned as central to its long-term profitability. Analysts say the safety issue could temporarily dampen investor confidence in its hybrid rollout.
How Did the Market React to the News?
Shares of Stellantis (STLA) were down about 3% in pre-market trading Tuesday following the recall announcement. The drop follows a volatile few weeks for auto stocks, which have faced broader pressure from supply chain costs and EV adoption concerns.
The setback highlights how difficult it is to push electrification forward while still ensuring quality and safety. The recall may not derail the company’s overall recovery, but it adds another challenge for a leadership team trying to prove that its U.S. business can deliver sustained growth.
Is Stellantis a Good Stock to Buy?
According to data from 14 Wall Street analysts, Stellantis (STLA) currently carries a “Moderate Buy” consensus rating. Out of the total, 5 analysts rate the stock a Buy, 8 suggest a Hold, and one recommends a Sell.
The average 12-month STLA price target stands at $10.93, implying a potential 6.95% upside from the recent price.
